Repeal Georgia Nuclear Tax

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by Kristi Swartz
ATLANTA 2/27/18 — A bill that would end the controversial financing law that’s being used to expand Plant Vogtle passed the Georgia Senate yesterday.

The measure would apply only to future nuclear reactors and would not affect Georgia Power Co.’s Plant Vogtle expansion project. Still, while the proposal (S.B. 355) does no immediate financial harm to Georgia Power, a unit of energy giant Southern Co., it carries major political significance.

Georgia Power is a political heavyweight at the state Capitol. The utility had roughly six dozen lobbyists help move the Georgia Nuclear Energy Financing Act through the Legislature in 2009, allowing the electric company to bill customers for Vogtle’s reactors as they were being built.

At the time, Georgia Power and nuclear supporters argued that doing so would pay down interest costs and save customers money over time. It would also send a signal to Wall Street that the Peach State stood behind Georgia Power building the nation’s first nuclear project from scratch in nearly 30 years.

Vogtle is now the lone nuclear project under construction in the U.S. It is years behind schedule and billions above its forecast budget. The financing costs have now roughly doubled, causing many to question whether the Legislature needed to review the 2009 law.

“If you had asked me at the beginning of the session if any legislation would move in this area, I’d say, ‘Absolutely not,’” said state Sen. Josh McKoon, a Republican from Columbus. “It’s one thing to stir up a hornet’s nest. It’s another to constructively engage Georgia Power, the other players, to come up with something that moves public policy in a direction that [the bill's sponsor] and I think it should be moving in.”

by Matt Kempner
8/26/17 ATLANTA: There’s a mad scramble underway to come up with new reasons for why Georgians should continue to pay billions of dollars to expand nuclear power in the state. National security! Push back against Russia and China! Healthcare!

Seriously? Yeah, if you believe elected officials, who in the next few days are supposed to get new cost estimates and recommendations from the state’s biggest electric provider.

It seemed like only yesterday when Georgia Power convinced politicians on the Georgia Public Service Commission that a primary reason for expanding Plant Vogtle was because it was the cheapest way to cool our homes, charge our iPhones and keep industry chugging.

Proponents can no longer say that without twitching.

Four years ago, the PSC’s outside financial monitor warned that because of cheap natural gas and, to some extent, rising Vogtle costs, “if a decision had to be made today to build a new nuclear project, it would not be justified on the basis of these results.”

Eight years after Georgia Power officials confidently assured us that they had this nuclear thing figured out, that two new units at Plant Vogtle could be brought in on budget and on time, leading a supposed renaissance in the U.S. nuclear industry, it’s all in danger of collapsing.

The projected cost of those units has almost doubled, to $25 billion and counting. Completion is still years away, and the prime contractor has gone bankrupt. Last month, construction of two similar units in South Carolina, facing similar cost overruns and delays, was abandoned after it became clear that the additional investment needed to complete the units could not be justified.

by Colby Bermel
6/13/17: Consultants to the Georgia Public Service Commission said June 8 that Westinghouse Electric Co. LLC’s bankruptcy has “invalidated” Georgia Power Co.’s cost calculations at its Alvin W. Vogtle Nuclear Plant and it would be “uneconomic” to complete the plant’s expansion.

The consultants also said that if Georgia Power were to continue construction, the Southern Co. subsidiary will spend $3 billion more on Vogtle than what it predicted in a recent report and the plant’s new units will go online three years later than the company anticipates.

Philip Hayet and Lane Kollen, both vice presidents and principals at J. Kennedy and Associates in Roswell, Ga., submitted written testimony to the commission on behalf of its Public Interest Advocacy Staff. The state agency is conducting a review of Georgia Power’s $222 million in Vogtle construction costs during the second half of 2016 for the Vogtle Construction Monitoring Report, or VCM.

6/11/17: Since 2009, Georgia Power customers have been paying up front for construction costs at the Plant Vogtle nuclear expansion.

Some public entities will have paid more than $1 million for construction before a single kilowatt hour of energy is generated by the expansion.

Georgia Power extended its interim agreement with Westinghouse by 24 hours recently to give the two companies time to finalize a transition agreement as the utility company takes over in the wake of the Westinghouse bankruptcy. That bankruptcy was fueled by cost overruns at the Plant Vogtle and VC Summer nuclear expansion projects.

According to legislation passed in 2009, Georgia Power shall collect costs related to nuclear construction financing and interest to support the plant’s construction, even though the project failed to meet its operational deadline in 2016.

by Gloria Tatum
6/11/17 (APN) ATLANTA — Georgia Public Service Commissioner Lauren “Bubba” McDonald (District 4) filed a motion to give Georgia Power ratepayers a break by asking the company to suspend collecting the nuclear construction tax, or CWIP.

But it had as much chance as a snowball in hell of being honored by the PSC or Georgia Power. The Commission voted to hold the motion and refer it to the Georgia Attorney General for an opinion, in a four to one vote on June 06, 2017.

“I move that the Commission request that the Company voluntarily agree that as of July 1, 2017, it will stop collecting any financing charges under the Nuclear Construction Cost Recovery (NCCR) tariff,” McDonald’s motion read.

“Effective July 1, 2017, the Company will utilize Allowance for Funds Used During Construction (AFUDC) accounting treatment on the Construction Work in Progress (CWIP) balance of all Unit 3 and 4 capital costs,” the motion stated.

by Kristi Swartz
6/8/17: Southern Co.’s nuclear expansion project in Georgia was behind schedule even before it got started.

Contractor Westinghouse Electric Co. LLC and the Nuclear Regulatory Commission grappled with design changes for the new AP1000 technology, delaying the agency’s issuance of the major construction license by four months in 2012.

They’ve never been able to catch up.

The delay was small at the time because Southern’s Georgia Power unit and the contractors said they could make up the time in some way. What’s more, the schedule slip meant little compared with the broader story: Georgia Power was restarting the nuclear industry after 30 years with Plant Vogtle.

by Anne Maxwell
WAYNESBORO, Ga. 5/8/17: The construction of two nuclear reactors at Plant Vogtle is years behind schedule and billions over budget. Last month, the contractor, Westinghouse Electric, filed for Chapter 11 bankruptcy protection.

Plant Vogtle employees hundreds of people in Burke County and the temporary contract with Westinghouse expires Friday, which means the project’s future after that is up in the air.

An attorney for Georgia Power, which is one of the main owners of Plant Vogtle, has said all options are on the table. They could totally shut down the project, or build only one of the two reactors they are currently constructing. There has also been talk of converting it to a natural gas plant, but it is not clear whether that would be economical. Or they could continue building despite even higher costs.

But no matter what happens, Georgia Power is still going to make a profit.

by Gloria Tatum
(APN) ATLANTA 4/24/17— On Tuesday, April 18, 2017, Glenn Carroll, Director of Nuclear Watch South (NWS), filed a request for an emergency public hearing with the Georgia Public Service Commission (PSC) to seek relief for ratepayers from the Construction Work in Progress (CWIP) tax on customers’ electric bills.

Georgia Power ratepayers have been paying in advance for the construction of Plant Vogtle nuclear reactor units 3 and 4 since 2009, because of the Georgia Legislature’s approval of CWIP via Senate Bill 31, which subverts the traditional ratemaking process and undermines the notion of Georgia Power shareholders taking any risk.

by Kristi Swartz
4/14/17: Scana Corp. executives might extend a contract with Westinghouse Electric Co. LLC as the utility decides whether to complete its multibillion-dollar nuclear power expansion in South Carolina.

Meanwhile, Southern Co.’s Georgia Power unit has yet to decide whether it needs more time to figure out how to proceed with its twin reactors under construction in Georgia.